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Sole Trader Start up

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  • Sole Trader Start up

    Hi there, could do with some guidance please if anyone can help. I am on the cusp of registering as a Sole Trader so that I can start to buy and sell items and make some money for myself. I haven't yet taken the leap but ive downloaded all the software I need for book keeping etc and continue to source more reading material to make sure I understand what's required.

    One of the things I'm not clear on, I already have a good selection of items that I want to sell through various outlets such as Ebay, car boots etc.. most of them I do not have receipts for to show show where I've purchased them but I do have a good memory on what I've paid for items. For book keeping purposes and opening as a sole trader from day one how do I record these items as an expense, would the lack of receipts etc agains these items cause problems ? Interested to learn.

    Many thanks
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  • #2
    Yes, it will cause problems for you down the road. You will eventually need to pay tax and without receipts it will be difficult to pay the correct amount as many items used for business purposes are tax deducible. You may have a good memory for what you have bought but can you really remember every business expense over a year? Make sure you get a receipt for everything you buy- if you cant get one write down exactly what the expense was for and how much and keep in a safe place , not only will this help you for tax but also good management of your business as well as refunds for faulty goods you may receive .

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    • #3
      He is only talking about the price of items he has collected and are now for sale, he's got the software in place for bookkeeping so that will cover future expenditure and income.

      If you were setting yourself up as a company I would say sell the items to the company

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      • #4
        You are a a sole trader. You are just starting out. If your business is small your "gross" income is less then 1,000. Then read the following:-

        https://www.gov.uk/guidance/tax-free...trading-income

        If it happens to do well.
        https://www.gov.uk/set-up-sole-trader

        I don't recommend becoming a Limited company, until you are sure have a good business. You will have on-going expenses in running one and until you know how business turns out. If you decide to stop or pause, you will keep paying fees.


        > I already have a good selection of items

        That is a good question. How to you record it?. From my hazy days of basic accounting. Your items are stock (current assets). Technically, you have not used the business cash to pay for it. So perhaps, come in as capital. My memory is hazy....


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